Dan Flynn is the writer of The Corn & Ethanol Report, a daily market letter covering grains, energies, and various global issues that are the driving force and backbone of the commodity markets. Contact Mr. Flynn at (312) 264-4374
We start off the day with MBA Mortgage Applications (13/NOV), and MBA 30-Year Mortgage Rate (13/NOV) at 6:00 A.M., Housing Starts & Permits (OCT) and Housing Starts & Permits MoM (OCT) at 7:30 A.M., Fed Evans Speech at 9:00 A.M., EIA Energy Socks at 9:30 A.M., 105-Day Bill & 154-Day Bill Auction at 10:30 A.M. Fed Williams Speech at 11:15 A.M., 20-Year Bond Auction at 12:00 P.M., Fed Bullard Speech at 12:20 P.M., Dairy Product Sales & Milk Production at 2:00 P.M., and Fed Bostic Speech at 6:00 P.M.
On the Hurricane Front Tropical Depression Iota battered portions of Central America, Flash flooding, river flooding and mudslides are expected in portions of Honduras, Nicaragua, and Guatemala and could be exacerbated by saturated soils in place, which could lead to more catastrophic impacts. And at the moment everything looks quiet on the Atlantic with nothing on the radar.
On the Corn Front the whispers in the market is more U.S. demand for corn exports which had the market close higher yesterday. We also saw funds buy 3,000 corn yesterday and should put the guesstimate at net-long 250,000 contracts. The CFTC commitment of traders showed funds less long than expected. The USDA announced 197(mt) of U.S. corn to Mexico with no new sales to China but they are trying to make a market. They will eventually have to purchase from the U.S. market. The Ukraine feeders have asked for export quota’s while Russia domestic corn prices are at a record high. That should tell us supplies are tight going into 2021and we will be watching events unfold in the Ukraine and South America and before you know it, will be talking U.S. plantings. There is one thing we will need in 2021 to get the crop in front of us, and that would be good weather. There is plenty of time to ponder that one. In the overnight electronic session, the December corn is currently trading at 522 ¾ which is 2 ½ cents higher. The trading range has been 422 ¾ to 418 ½.
On the Ethanol Front the global pandemic is rising and more fears before the vaccine is delivered, ethanol firms that used innovation to get all possible uses out of ethanol and alcohol purposes and other uses to possibly get an influx of revenue from another industry when the auto-based ethanol usage expects to be down. The benefit companies saw was, “not to have all your eggs in one basket,” and there is going to be new strategies unfold at these companies. There were no trades posted in the overnight electronic session. The December ethanol settled at 1.420 and is currently showing 1 bid @ 1.330 and 0 offers with Open Interest at 36 contracts.
On the Crude Oil Front the API’s came out with builds in crude oil +4.174 M, Cushing +0.176 M, gasoline +0.256 and distillates -5.024 M. We are trading higher across the board in the energy complex and the December crude oil is currently trading at 4229 which is 86 higher. The trading range has been 4246 to 4108.
On the Natural Gas Front prices continued to slide yesterday but were able to hold support. Demand is expected to come under pressure with warmer-than-normal temps forecasted and lower building consumption. The RSI moved lower but stabilized after pushing through the oversold trigger level of 30. In the overnight electronic session, the December natural gas is currently trading at 2.757 which is .065 higher. The trading range has been 2.783 to 2.687.
Have A Great Trading Day!